SYDNEY—Australia’s
Santos Ltd.
SSLZY -3.47%
said it would slash capital spending by 26% next year and consider asset sales, as it tries to fortify its balance sheet against tumbling oil prices.

Australia’s third-largest oil company by output said it plans to spend 2.0 billion Australian dollars (US$1.66 billion) on new ventures in 2015, down from previous guidance for A$2.7 billion.

While asset sales are also under consideration, the company said it has a “robust funding position”.

Credit Suisse
this week called on Santos to issue new shares in the company at a discount to raise at least A$2.5 billion in equity. On Thursday, Santos said it has no such plans.

“The company has no present need or intention to raise equity,” David Knox, Santos’s chief executive, said in a statement. Among Australia’s large-cap oil companies, Santos has been the hardest hit by crude oil’s plunge.

The Adelaide-based company is completing construction of an US$18.5 billion gas-export joint venture with
Total SA
in Australia’s Queensland state—a giant project that investors fear will put too much strain on its balance sheet in a low-oil-price environment.

Santos shares fell another 5.7% on Thursday amid a continued slide in oil prices, extending their losses to 38% since the Organization of the Petroleum Exporting Countries last month sent turmoil through global markets by keeping its oil-production targets steady.

Meanwhile,
Origin Energy Ltd.
, which is building a rival gas-export plant in Queensland with
ConocoPhillips,
said Thursday it has renegotiated its loan facility for the project. The loan has been increased by A$750 million to A$7.4 billion, Origin said, adding that its maturity has been extended and the cost of interest reduced.

The economics of the project remain “robust” in the current oil-price environment, Origin said.